(The Center Square) – A recent letter from the Nevada Attorney General’s office estimated illegal online gambling was worth over $400 billion in total annual volume, with states losing a likely $4 billion in tax revenue.
The boom in online gambling presents a generational puzzle for the brick and mortar casinos along the Las Vegas Strip.
“Illegal online gaming is a danger to every jurisdiction and requires bipartisan collaboration to stop,” wrote Nevada Attorney General Aaron Ford in the letter. “Regulations on gaming exist to ensure the industry’s economic activity is safe and non-predatory. Nevada’s gaming industry is the envy of the world because our state has benefitted from an important and ongoing dialogue between the public and private sector. Illegal online gaming acts outside of this industry and opens up our youth and vulnerable populations to harm.”
The letter was written along with attorneys general with a number of Republican and Democratic states and U.S. territories, asking for the Department of Justice (DOJ) to take action against the unregulated industry.
The attorneys general listed three main ways for the DOJ to curb the growth of illegal online gambling – blocking access to illegal sites via the Unlawful Gambling Enforcement Act, seizing assets such as domains and servers, and working with financial institutions like banks to block transfers of money.
The American Gaming Association (AGA) found that the sports betting market, which has skyrocketed in popularity in recent years, is roughly 40% captured by illegal sites.
“All stakeholders – policymakers, law enforcement, regulators, legal businesses – must work together to root out the illegal and unregulated gambling market,” said AGA President and CEO Bill Miller in a press release. “This is a fight we’re in for the long haul to protect consumers, support communities and defend the law-abiding members of our industry.”
But more than anything, the AGA and Attorney General Ford could help protect the state’s revenue. In 2024, the legal gambling industry’s total economic impact was estimated at $87.7 billion by the Las Vegas Convention and Visitors Authority.
“The casino industry in Las Vegas peaked in 2006, dropping a little bit in recessions, and not coming back quite as far [afterwards],” Nevada Department of Employment, Training, and Rehabilitation Chief Economist David Schmidt told The Center Square.
While the new growth in the illegal online gambling industry further threatens this Las Vegas gambling industry, Schmidt said residents should not give up hope.
“The non-casino entertainment is helping to round out that puzzle even more than just the casino industry,” he said.
Still, since this time last year hotel occupancy, convention center attendance, and passengers to Las Vegas’ Harry Reid International Airport declined since June of last year, as per the LVCVA.
